IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-H2820 IDA-H5960) ON A GRANT IN THE AMOUNT OF SDR 120 MILLION (US$180 MILLION EQUIVALENT) AND AN

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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Document of The World Bank Report No: ICR IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-H2820 IDA-H5960) ON A GRANT IN THE AMOUNT OF SDR 120 MILLION (US$180 MILLION EQUIVALENT) AND AN ADDITIONAL GRANT FROM THE CRISIS RESPONSE WINDOW IN THE AMOUNT OF SDR 26.5 MILLION (US$40 MILLION EQUIVALENT) TO THE DEMOCRATIC REPUBLIC OF CONGO FOR AN EMERGENCY URBAN AND SOCIAL REHABILITATION PROJECT November 27, 2013 Sector Department AFTU2 (Water and Urban Services) Country Department AFCC2 Africa Region

2 CURRENCY EQUIVALENTS (Exchange Rate Effective May 31, 2013) Currency Unit = US$ CDF 1.00 = US$ US$ 1.00 = CDF FISCAL YEAR January 1 December 31 ABBREVIATIONS AND ACRONYMS AF BP CAF CAS CDF CDPI DRC EESRSP ELCISP EMRRP ESP EUSRP FONER FY GDP ICR IDA IPS ISR ITN M&E N/A NGO NPV OP OVD PPF PNLP PRSP RAP SECOPE SOE UCoP UNICEF UNOPS UWSP WHO Additional Financing Bank Procedure Country Assistance Framework Country Assistance Strategy Congolese Franc Cellule de la Dette Publique Intérieure (Public Domestic Debt Unit) Democratic Republic of Congo Emergency Economic and Social Reunification Support Project Emergency Living Conditions Improvement Support Project Emergency Multi-sector Rehabilitation and Reconstruction Project Ecole de Santé Publique (School of Public Health) Emergency Urban and Social Reunification Project Fonds National d Entretien Routier (Road Maintenance Fund) Fiscal Year Gross Domestic Product Implementation Completion and Results Report International Development Association Institut Provincial de Santé (Provincial Health Institute) Implementation Status and Results Report Insecticide-treated bed nets Monitoring and Evaluation not applicable Non-Governmental Organization Net Present Value Operational Policy Office de Voirie et Drainage (Urban Roads Agency) Project Preparation Facility Programme National de Lutte contre le Paludisme (National Program to Fight Malaria) Poverty Reduction Strategy Paper Resettlement Action Plan Service de Contrôle de la Paie des Enseignants (Department for Monitoring the Payment of Teacher Salaries) State-Owned Enterprises Unité de Coordination de Projets (Project Coordination Unit) United Nations Children s Fund United Nations Office for Project Services Urban Water Supply Project World Health Organization ii

3 Vice President: Makhtar Diop Country Director: Eustache Ouayoro Sector Manager: Alexander Bakalian Project Team Leader: Mahine Diop ICR Team Leader: Mahine Diop ICR Author: Christian Vang Eghoff iii

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5 DEMOCRATIC REPUBLIC OF CONGO Water, Electricity and Urban Development Project CONTENTS Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Results Framework Analysis G. Ratings of Project Performance in ISRs H. Restructuring I. Disbursement Graph 1. Project Context, Development Objectives and Design Key Factors Affecting Implementation and Outcomes Assessment of Outcomes Assessment of Risk to Development Outcome Assessment of Bank and Borrower Performance Lessons Learned Comments on Issues Raised by Borrower/Implementing Agencies/Partners Annex 1. Project Costs and Financing Annex 2. Outputs by Component Annex 3. Economic and Financial Analysis Annex 4. Bank Lending and Implementation Support/Supervision Processes Annex 5. Beneficiary Survey Results Annex 6. Stakeholder Workshop Report and Results Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders Annex 9. List of Supporting Documents MAP IBRD R2 iv

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7 A. Basic Information Country: Congo, Democratic Republic of Project Name: Project ID: P L/C/TF Number(s): DRC Emergency Urban and Social Rehabilitation Project IDA-H2820,IDA- H5960 ICR Date: 11/26/2013 ICR Type: Core ICR Lending Instrument: ERL Borrower: Original Total Commitment: Revised Amount: XDR M Environmental Category: B Implementing Agencies: Unité Coordination des Projet (UCoP) Cofinanciers and Other External Partners: B. Key Dates GOVERNMENT OF DRC XDR M Disbursed Amount: XDR M Process Date Process Original Date Revised / Actual Date(s) Concept Review: 12/06/2006 Effectiveness: 07/06/ /06/2007 Appraisal: 01/22/2007 Restructuring(s): 02/02/ /25/2012 Approval: 03/29/2007 Mid-term Review: 07/06/ /05/2009 Closing: 05/31/ /31/2013 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Risk to Development Outcome: Bank Performance: Borrower Performance: Satisfactory Substantial Satisfactory Moderately Satisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Quality at Entry: Moderately Satisfactory Government: Moderately Satisfactory Implementing Quality of Supervision: Satisfactory Moderately Satisfactory Agency/Agencies: Overall Bank Performance: Satisfactory Overall Borrower Performance: Moderately Satisfactory v

8 C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments Indicators Performance (if any) Potential Problem Project Yes at any time (Yes/No): Problem Project at any time (Yes/No): DO rating before Closing/Inactive status: No Satisfactory Quality at Entry (QEA): Quality of Supervision (QSA): None None Rating D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Central government administration General education sector Health 7 15 Urban Transport Water supply Theme Code (as % of total Bank financing) City-wide Infrastructure and Service Delivery Debt management and fiscal sustainability Education for all Malaria Urban services and housing for the poor E. Bank Staff Positions At ICR At Approval Vice President: Makhtar Diop Gobind T. Nankani Country Director: Eustache Ouayoro Pedro Alba Sector Manager: Alexander E. Bakalian Eustache Ouayoro Project Team Leader: Mahine Diop Xavier Devictor ICR Team Leader: ICR Primary Author: Mahine Diop Christian Vang Eghoff vi

9 F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) To help DRC face urgent post-elections challenges by: (i) providing resources to maintain macro-economic stability and fund critical expenditure in the immediate future; and (ii) addressing urgent rehabilitation and social needs in Kinshasa, which is key to political and social stability. Revised Project Development Objectives (as approved by original approving authority) To respond to urgent challenges by: (i) supporting domestic debt settlement; and (ii) addressing urgent rehabilitation and social needs in targeted areas. (a) PDO Indicator(s) Indicator Baseline Value Original Target Values (from approval documents) vii Formally Revised Target Values Actual Value Achieved at Completion or Target Years Indicator 1 : People in urban areas with access to Improved Water Sources. Value quantitative or Qualitative) 89, ,000 N/A 216,000 Date achieved 03/12/ /30/ /31/ % achieved. The project reported total beneficiaries with access to water in Comments targeted areas, which is retained for the ICR. With baseline 0 additional people, (incl. % the target was 150,000 additional people and the actual value was 127,000 achievement) additional people. Indicator 2 : People in urban areas provided with access to all-season roads within a 500 meter range under the project. Value quantitative or Qualitative) 0 800,000 N/A 1,300,000 Date achieved 03/12/ /31/ /31/2013 Comments (incl. % achievement) Indicator 3 : Value quantitative or Qualitative) 163% achieved. More people were served by the roads than expected, although the length of roads rehabilitated by the project did not change. This was because the population densities of beneficiary neighborhoods were higher than estimated at appraisal. Children under 5 years old sleeping under bed nets in targeted areas (Kinshasa and Bandundu Province). 32% Kinshasa; 6% Bandundu on 5/28/ % Kinshasa; N/A Bandundu N/A 80% Bandundu 65% Kinshasa; 91% Bandundu on 11/30/2012 Date achieved 03/12/ /28/ /31/ /31/2009 Comments 108% achieved for Kinshasa as per post-distribution evaluation, 114% achieved (incl. % for Bandundu Province as per post-distribution evaluation. achievement) Schools receiving payments that have improved their learning environment Indicator 4 : (basic school supplies, small equipment, and repairs, other pedagogical inputs).

10 Value quantitative or Qualitative) 0% 70% 75% 77% Date achieved 03/12/ /31/ /31/ /31/2013 Comments (incl. % achievement) 103% achieved. Result is average of beneficiary satisfaction survey (79% of schools had improved learning environment), and survey carried out for economic analysis of Education Component (75% of schools had improved learning environment). Creditors party to the amended settlement having received the full payment. Indicator 5 : Value quantitative or 0% 95% N/A 99.5% Qualitative) Date achieved 03/12/ /31/ /31/2008 Comments (incl. % 105% achieved. achievement) Indicator 6 : Direct project beneficiaries (of which female). Value million 20.3 million quantitative or 0 N/A (51.8%) (51.8%) Qualitative) Date achieved 03/12/ /31/ /31/2013 Comments (incl. % 94% achieved. achievement) (b) Intermediate Outcome Indicator(s) Indicator Baseline Value Original Target Values (from approval documents) viii Formally Revised Target Values Actual Value Achieved at Completion or Target Years Indicator 1 : Eligible schools having received all installments. Value (quantitative or Qualitative) 0% 70% 90% 65% Date achieved 03/12/ /31/ /31/ /31/2013 Comments (incl. % achievement) 72% achieved. With non-disbursement of additional financing (exclusively targeting secondary schools), only primary schools received all installments from the original project (which targeted primary as well as secondary schools). Indicator 2 : Roads rehabilitated, non-rural. Value (quantitative or Qualitative) 0 km 40.0 km N/A 40.2 km Date achieved 03/12/ /31/ /31/2013 Comments (incl. % 101% achieved. achievement) Indicator 3 : Improved community water standposts constructed of rehabilitated under the

11 project. Value (quantitative or Qualitative) 0 80 N/A 86 Date achieved 03/12/ /30/ /31/2013 Comments (incl. % achievement) 108% achieved. In reality 88 standposts were foreseen in the technical studies, with 80 targeted by the project. In the end, 86 standposts were sufficient to cover the targeted neighborhoods. Indicator 4 : Primary, secondary and tertiary network built/rehabilitated. Value (quantitative or Qualitative) km N/A 85.3 km Date achieved 03/12/ /30/ /31/2013 Comments (incl. % achievement) 61% achieved. The initial indicator overestimated the length of network needed to reach the targeted areas; the actual quantities were sufficient to suit the project objective. Indicator 5 : New piped household water connections that are resulting from the project intervention (number). Value (quantitative or Qualitative) 0 8,300 N/A 1,088 Date achieved 03/12/ /30/ /31/2013 Comments 13% achieved. The project did not achieve the target, as the strategy was not (incl. % conducive to garnering interest for new connections (see main text for details). achievement) Indicator 6 : Long-lasting insecticide-treated malaria nets purchased and/or distributed. Value (quantitative or Qualitative) 0 2,000,000 4,500,000 4,781,851 Date achieved 03/12/ /28/ /31/ /31/2012 Comments 106% achieved. In reality the target (4.5 million) was set conservatively, so the (incl. % achievement (4.8 million) corresponds to full coverage as intended. achievement) G. Ratings of Project Performance in ISRs No. Date ISR Archived DO ix IP Actual Disbursements (USD millions) 1 09/28/2007 Satisfactory Satisfactory /28/2008 Satisfactory Satisfactory /25/2008 Satisfactory Satisfactory /27/2009 Satisfactory Satisfactory /05/2009 Satisfactory Satisfactory /03/2010 Satisfactory Satisfactory /13/2010 Satisfactory Satisfactory /16/2011 Satisfactory Satisfactory

12 9 02/14/2012 Satisfactory Moderately Satisfactory /30/2012 Satisfactory Moderately Satisfactory /10/2013 Satisfactory Moderately Satisfactory H. Restructuring (if any) Restructuring Date(s) Board Approved PDO Change ISR Ratings at Restructuring DO IP Amount Disbursed at Restructuring in USD millions 02/02/2011 Y S S /25/2012 S MS Reason for Restructuring & Key Changes Made To provide additional financing for the education, malaria, and project management components, adjust PDO and KPIs, and extend closing date by one year to 05/31/2012. Difference in amount disbursed compared to Annex 1 is due to exchange rate fluctuation. To extend closing date by one year to 05/31/2013 and effect minor reallocation of funds for original Grant. If PDO and/or Key Outcome Targets were formally revised (approved by the original approving body) enter ratings below: Outcome Ratings Against Original PDO/Targets Satisfactory Against Formally Revised PDO/Targets Moderately Satisfactory Overall (weighted) rating Satisfactory x

13 I. Disbursement Profile xi

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15 1. Project Context, Development Objectives and Design 1.1 Context at Appraisal 1. The Democratic Republic of Congo (DRC) had experienced a decade of political instability and conflict, with major fighting ending in A period of tumultuous political transition ensued, with the first democratic elections ever organized in the country since its independence held in This marked a key milestone in DRC s advance towards peace and stability. The situation remained volatile following the elections and the challenge was to consolidate and expand achievements. Violence continued to simmer in a few Eastern districts and in January of 2007, riots in the Province of Bas Congo in the West claimed over 100 lives, illustrating the persistence of political tensions. 2. On the economic front the efforts made since 2001 were paying off with economic growth at about 6 percent a year and a relatively stable, although fragile, macroeconomic situation. The overall fiscal balance was under control at -0.7 percent of GDP in 2006 and expenditure was 22.1 percent of GDP. But this should be seen on the basis of per capita income of only US$139 and inflows of external assistance of about US$15 per capita. The government s resources were too limited to face urgent needs. The debt-to-gdp ratio was very high at 120 percent and the current account deficit (including official transfers) was expected to increase from 7 percent of GDP in 2006 to 10 percent of GDP in 2011, reflecting DRC s need for external capital. During the conflicts, the government had accumulated US$1.3 billion in debt to domestic enterprises and foreign reserves were chronically low, at times below two weeks of imports. 3. The situation was explosive in many parts of the country; about 75 percent of the Congolese lived on less than US$1 a day and social indicators were among the worst in Sub-Saharan Africa. Infrastructure and services had considerably deteriorated during the conflict. Chronic under-funding of the education system was a main cause of low school enrollment and completion rates the most recent figures showed a primary enrollment rate of 54 percent in 1990 and a completion rate of 39 percent in The result was a literacy rate of about 32 percent. 4. Urban economic collapse and inflows of displaced persons combined to create a highly volatile environment in urban areas. Infrastructure had not been maintained and in Kinshasa many neighborhoods were isolated from the city center. About 13 percent of the city s roads were tarred and properly drained; the rest were constructed in dirt and without drainage. Less than a third of all roads in the city were passable by car. The operational performance of the water utility company (REGIDESO) had declined considerably and the rate of water supply services coverage in urban areas had fallen, from 68 percent in 1990 to 35 percent in In Kinshasa, 40 percent of the population had direct access to water. Water-related and water-borne diseases, particularly malaria, were among the main causes of mortality with an estimated 12,000 children under 5 years old dying from malaria in Kinshasa every year. 1

16 Government strategy and response 5. The new government, elected in 2006, had centered its recovery strategy on improving governance and fighting corruption, restoring security throughout the country, rebuilding infrastructure, improving social services delivery (particularly education and health), and creating jobs. This strategy was consistent with the Poverty Reduction Strategy Paper (PRSP, ) adopted in 2006 which was based on five pillars: (a) promoting good governance and consolidating peace; (b) consolidating macroeconomic stability and economic growth; (c) improving access to social services and reducing vulnerability; (d) combating HIV/AIDS; and (e) promoting community dynamics. Faced with a tight budget situation the government called upon its development partners to provide emergency assistance to support its efforts in the early post-elections period, to help provide basic services and maintain economic and political stability, while waiting for support to materialize through traditional donor-funded development programs. World Bank strategy and response 6. The World Bank response was part of a broad and multi-dimensional effort by the international community, which included an important security effort, the continuation of political mediation, economic assistance, debt relief, and humanitarian aid. More specifically, the Bank was leading a significant donor harmonization effort centered on a Country Assistance Framework (CAF), involving 14 donor agencies. The CAF provided the underpinning of the Bank Group Country Assistance Strategy (CAS, ), under preparation and approved by the Board on December 18, In the CAS, the Bank articulated a multifold response aimed at helping the government face the immediate challenges of the post-elections period, which included support in developing a recovery strategy, accelerating implementation of the existing portfolio, and provision of additional financing under OP13.20 (Additional Financing for Investment Lending) to scale up successful ongoing projects and support recovery activities. 7. Pressure to deliver peace dividends - improvements in basic services, infrastructure, and income opportunities - was heightened by the risk of relapse into violence, particularly in urban areas, with influential and vocal populations. The Bank had a comparative advantage in the design and implementation of rehabilitation programs that pave the way for economic recovery in post-conflict countries and support peace consolidation and social stability, specifically in the DRC, and was seen by both the government and other donors as one of the most adept financiers of such efforts. The proposed operation would build on this experience and comparative advantage. The Emergency Urban and Social Rehabilitation Project (EUSRP) was fully in line with the CAS objective of concentrating on areas which have a relatively high population density, with a specific focus on peri-urban areas with low service coverage rates. This would allow the Bank-financed activities to reach the most vulnerable and improve access to services. 8. The EUSRP was an integral part of the portfolio of Bank-funded projects, both ongoing and in the pipeline, which together would help address the most pressing needs throughout the country: (a) the Emergency Multi-sector Rehabilitation and Reconstruction Project (EMRRP, 2002), targeted the most basic and urgent needs 2

17 through community sub-projects; (b) the Emergency Economic and Social Reunification Support Project (EESRSP, 2004), contributed to stabilizing the economy and the social fabric in the Eastern and Northern provinces; and (c) the Emergency Living Conditions Improvement Support Project (ELCISP, 2005) focused on the remaining provinces outside Kinshasa. By financing the EUSRP the Bank could complement the support provided elsewhere and also support emergency efforts in Kinshasa, which was receiving a disproportionately small part of donor assistance. 1.2 Original Project Development Objectives (PDO) and Key Indicators (as approved) 9. The original PDO was to help the DRC face urgent post-elections challenges by: (i) providing resources to maintain macro-economic stability and fund critical expenditures in the immediate future; and (ii) addressing urgent rehabilitation and social needs in Kinshasa, which was key to political and social stability. This was expected to help create an environment in which reforms could be sustained and to prevent political and economic regression, which may otherwise have resulted in social instability, civil unrest and possibly reversion to conflict. 1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification 10. The PDO was revised in connection with provision of Additional Financing to the Project on February 2, 2011 to make it more focused and realistic and remove the reference to post-elections challenges. The revised PDO was to respond to urgent challenges by: (i) supporting domestic debt settlement; and (ii) addressing urgent rehabilitation and social needs in targeted areas. 1.4 Main Beneficiaries, 11. The original primary target group was the population of Kinshasa benefiting from distribution of Insecticide-Treated Bed Nets (ITNs) as a means to reduce the number of malaria cases. In Kinshasa, additional benefits would accrue to the population of poor neighborhoods targeted for improvements in water supply and roads under the project. Other beneficiaries were the owners of companies that were part of a debt settlement scheme supported by the Project. Pupils of primary and secondary schools throughout the country and their parents would benefit from better learning environment through the Project s contribution to sustaining some operating expenditures of the schools. An Additional Financing (AF) for the project was approved in 2011 to: (a) expand geographic scope of ITN distribution to Bandundu Province, where the population would benefit from protection against malaria; and (b) finance an additional year of operating expenditures for secondary schools throughout the country to the benefit of pupils and families. 3

18 1.5 Original Components (as approved) Component 1: Support to education recovery through finance of select recurrent expenditures (US$45.00 million) 12. This component would finance select recurrent, non-salary expenditures for about 26,000 schools (about 18,000 primary and 8,000 secondary schools) throughout the country (with about 13.5 million pupils) for an amount of about US$8 million per quarter between grant effectiveness and the completion of the school year. The component was expected to test an effort that would eventually be implemented on government s own resource (possibly with donor support) and result in a reduction of school fees paid by the parents. The component would also fund implementation expenditure for Service de Contrôle de la Paie des Enseignants (Department for Monitoring the Payment of Teacher Salaries, SECOPE), transfer fees, a communication campaign, and audits of the payments. Component 2: Completion of the domestic debt settlement (US$50.00 million) 13. This component would finance the completion of a Bank-supported process for settling the debt accrued by the government to domestic suppliers during the conflict, which ended in A total of 379 creditors would benefit based on an already completed audit of creditors and negotiated discount between the government and creditors for a debt of US$1.3 billion. A first tranche (for 2005, 50 percent of discounted debts) had been paid under a Bank-funded Post-Reunification Economic Relaunch Credit. The EUSRP would pay the two remaining tranches (2006 and 2007, 25 percent each), as well as audits of the payments and impact evaluation. This was expected to contribute to improving the investment climate and to injecting resources likely to increase the available working capital for private sector activities, as well as to improve the relationship between the government and its suppliers and thus contribute to restoring an efficient and transparent public expenditure environment. Component 3: Rehabilitation of priority urban roads in Kinshasa (US$42.00 million) 14. This component would finance rehabilitation of about 40 kilometers of access roads to poor neighborhoods, which was expected to restore or significantly improve accessibility by vehicle to poor neighborhoods, with an estimated 800,000 direct beneficiaries. An initial tranche of road works was determined during preparation, based on available studies that needed to be updated, and a second tranche of works was to be determined during implementation, based on economic and needs criteria. The component also included limited institutional support to the Office de Voirie et Drainage (Urban Roads Agency, OVD) for monitoring component implementation. 4

19 Component 4: Water and Sanitation in peri-urban areas of Kinshasa (US$25.00 million) 15. This component would finance completion of the Lukaya water system (in the South-Western part of Kinshasa) to benefit fully from a newly constructed water treatment plant: (a) update of the technical studies available from the Bank-funded EMRRP, (b) storage facilities and expansion of the distribution network to poor neighborhoods (Mont Ngafula, Ngaliema, Lemba, and Selembao), and (c) installation of household connections and water standposts. This was expected to provide access to potable water to approximately 150,000 additional people who had inadequate access to water. Component 5: Malaria reduction and prevention (US$13.00 million) 16. This component would finance the distribution of ITNs to all households in Kinshasa (about 2 million ITNs in total), as a means of reducing malaria-related mortality, particularly among children under the age of 5. The component would also finance a communications campaign and an impact evaluation. Component 6: Project management (US$5 million) 17. This component would finance the management of project implementation, including incremental operating expenditures of the Unité de Coordination de Projets (Project Coordination Unit, UCoP) already implementing several other Bank-funded emergency projects, monitoring and evaluation, procurement agent, socio-environmental studies and monitoring and attenuation of social and environmental impacts through technical assistance, as well as audits. 1.6 Revised Components 18. An AF agreement was signed for the project on February 2, 2011 to scale up the Education and Malaria Components and finance additional operating expenditures as follows (also see financing tables in Annex 1): Component 1 (Education): Additional financing of US$19.5 million (for a total component allocation of US$64.5 million) to pay for an additional two tranches of payment of select operating expenditures to about 10,000 1 secondary schools throughout the country (the Education Sector Reform Support Project was taking over payments to primary schools). Component 2 (Malaria): Additional financing of US$19.5 million (for a total component financing of US$32.5 million), to replicate the successful ITN distribution campaign in Kinshasa to the Bandundu Province. 1 Up from 8,000 secondary schools in the original project, as more schools had been established and registered in the meantime. 5

20 Component 6 (Project Management): Additional financing of US$1.0 million (for a total component financing of US$6 million) to allow UCoP to implement all activities. 1.7 Other significant changes 19. The AF was used to extend the closing date from May 31, 2011 to May 31, The extension was not triggered by the AF activities but due to delays with implementing the Roads and Water Components caused by technical difficulties and time taken to manage the resettlement process. A second project extension, from May 31, 2012 to May 31, 2013, was granted on April 25, 2012, to allow completion of activities under the original Roads and Water Components (continued technical difficulties) and the AF for the Education Component. The Education AF was experiencing delay due to time taken to complete the audit of the last payment of operating expenditures funded by the original project (which had to be acceptable to the Bank, as a disbursement condition for the Education AF). The second extension was also used to approve a reallocation of funds between components due to cost savings (See details in Section 2.2 and reallocation table in Annex 1). 2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design and Quality at Entry Preparation and design 20. The project preparation period was highly contracted, with less than four months between concept review (December 6, 2006) and project approval by the Board (March 29, 2007). This short preparation period was necessary to respond to the emergency situation, as there was tremendous pressure on the Bank to deliver quickly to help mitigate the volatile situation. By leveraging existing studies the project could be prepared without making use of a Project Preparation Advance, so an informed tradeoff was made between the need for fast preparation and committing resources on one hand and accepting some unknown elements not having fully updated technical studies prior to appraisal on the other hand. In the short preparation time, the Bank and client together managed to design a project that could address some of the most pressing needs and lay the groundwork for longer-term development efforts in regular sector projects, as described below. 21. The rationale for the Bank s intervention is demonstrated by the experience in designing emergency operations in the DRC, and the ability to design and fund follow-on sector operations for sustainability of the emergency interventions. Success of the project in the timeframe needed to have an impact on the socio-political situation depended on the use of flexible and accelerated procedures as allowed under OP8.00, particularly in the processing of project preparation, safeguards compliance, procurement, and disbursement arrangements. Safeguard studies were to be completed within six months of effectiveness. In line with OP 8.00 the project did not directly address long-term economic issues or policy and institutional reforms. 6

21 22. The implementation arrangements were suitable, with an overall coordinating agency (UCoP) and relying as much as possible on other government agencies or institutions (SECOPE for education, OVD for roads, REGIDESO for water, for Malaria the Provincial Health Institute (Institut Provincial de Santé, IPS) and the National Program to Fight Malaria (PNLP), as well as the Cellule de Dette Publique Intérieure (Public Domestic Debt Unit CDPI) for implementation. OVD and REGIDESO had rather limited capacity, so they would not be responsible for implementation, but would participate fully in defining needs, developing studies and supervising works implementation, while receiving training and equipment support to improve their ability to implement future works. To keep UCoP as a light structure, the sound choice was made to select UNOPS by sole source selection to manage the procurement process for the Roads and Water Components, as they were the only capable procurement agent present in Kinshasa and the project needed to move quickly. A specialized agency would be selected to distribute ITNs (IPS), since no government agency possessed the capacity to carry out this task and another agency would be recruited to overcome capacity gaps in safeguards monitoring (Sofreco). 23. The concept was agreed with the government based on the need to provide peace dividends and lessen post-election tensions in Kinshasa, hitherto benefiting from a disproportionately small share of reconstruction efforts, while also providing limited country-wide benefits in the crucial education sector and contributing to boosting reemergence of the private sector. The project would generate visible benefits to the population (especially in volatile Kinshasa), as a means to contribute to averting a social crisis that could jeopardize the hard-earned results of the political transition and reverse achievements under the peace process. Therefore it was fully justified to develop a multisector project, in spite of the inherent implementation complexities from many disparate activities in several sectors. The fact of having an implementing agency with demonstrated ability to deliver (UCoP) meant that the complexity was evaluated as acceptable given the expected benefits. 24. The PDO reflected the emergency situation and the support provided by the project through targeting macroeconomic stability, improving access to social services and reducing vulnerability. Although the project interventions could reasonably be expected to help create an environment in which reforms could be sustained and to prevent political and economic regression, the PDO was phrased as a higher-order objective and should have been more specific and with results more clearly attributable to project interventions. 25. The two first components (Education and Debt) aimed at supporting the new government in maintaining macro-economic stability and in funding critical expenditures The Education Component introduced a novel concept for the payment of operating expenditures in schools, justified by these being critical to the functioning of the education system, reaching the whole country with benefits, and laying the groundwork for turning around a dysfunctional school system. The component would provide funds to the level that has the most impact on enhancing the education environment and quality of education. The component was designed to include parents in decisions regarding 7

22 expenditures, for a more inclusive and better targeting of investments. The component turned out to be more complex than expected, and the PAD could have been more explicit about the element of uncertainty in launching a novel process in the sector covering the whole territory. Domestic debt settlement was expected to lead to increased confidence of the private sector in the government s ability to pay its bills and in turn to increased private sector investments. The debt component was based on an already ongoing process supported by the Bank, but for which the funding was lacking, and could disburse quickly. 26. The three other components (Roads, Water, and Malaria) aimed at addressing urgent rehabilitation and social needs and were selected on the basis of the provincial Poverty Reduction Strategy Paper (PRSP) for Kinshasa and retained based on their expected impact on living conditions, the likelihood of being implemented rapidly and their complementarity with other Bank- or donor-funded operations. The Road and Water Components were designed based on available and relatively recent technical design studies, which provided some reassurance that the components could disburse quickly. During implementation it transpired that the studies were more outdated than could have been expected, which did result in some delays. The activities were coordinated with other ongoing activities. The Road Component would be implemented in two tranches, to allow quick disbursement while keeping some funds for rehabilitation works to be determined during implementation based on a more detailed determination of needs. For the Water Component the update of technical studies prepared in 2003 was carried out during preparation, on funds for another World Bank-funded project (EMRRP). Distribution of ITNs had proven extremely efficient and effective in reducing the impact of the malaria scourge on especially poor households in the Eastern Provinces and the lessons were used to design the malaria component, to provide immediate benefits to the population of Kinshasa. 27. The design of each component was mostly adequate and simple, with the exception of the Education Component, and relied on existing technical studies and the ongoing process for debt settlement. Regrouping the distinct components in one project was a good way for the Bank to quickly provide multi-faceted support in the emergency context. For each component the government sector ministry or responsible agency was fully involved in preparation and the Technical Reform Committee in the Ministry of Finance also played a coordinating role. OVD was involved in updating technical studies for the Road Component, a convention was signed between UCoP and the IPS to coordinate with other health programs in Kinshasa. Specialized firms were to be recruited to assure procurement and safeguards aspects, while the existing Project Coordinating Unit in the Ministry of Planning (UCoP, already implementing the Bank-funded EESRSP and ELCISP) was charged with project preparation to overcome capacity constraints in the government administration. Quality at entry 28. The quality at entry is rated moderately satisfactory. The client and Task Team put together a multifaceted response in a short period of time which included relevant activities that aimed to address the most urgent and unmet needs for reconstruction and 8

23 service delivery. Components were designed to address an array of the most urgent needs, but the PDO was phrased as a higher level objective. Design built on emerging good practices and available studies to the extent possible. The Debt and Malaria Components were realistically expected to disburse quickly. The expected timing of implementation of the other components in the PAD was less realistic; the quality of available studies should have been checked closer. Substantial shortcomings on these technical studies became apparent during implementation, and the time needed for implementation of three of five components was substantially underestimated, which is an important element of an emergency operation. 2.2 Implementation 29. The project was declared effective on July 6, 2007, within the 90 day period from the signing of the financing agreement on April 11, The Domestic Debt Settlement and Malaria Components were implemented without major problems, whereas the Education, Roads, and Water Components encountered some implementation difficulties and delays. The mid-term review in November 2009 was used to correct some of these problems, and the AF approved in February 2011 used to scale up the well-performing components. On April 25, 2012, the project was extended and slight reallocations between components approved by the Bank (see below and Annex 1). At the project closing date all activities were completed, with the exception of the AF for the Education Component, and all infrastructures are operational as confirmed by technical audits and site visits (see Annex 2 on project outputs). The project generally made good use of mass communication, especially for the Education, Water, and Malaria Components; Radio Okapi was used to reach a large part of households, combined with more targeted communication in the beneficiary areas. Due to the multi-sector nature of the EUSRP, factors that contributed to successful implementation or gave rise to problems are presented below by component. Component 1: Education 30. The component got off to a slow start, as it turned out that the short preparation time had not allowed a sufficiently detailed review of the payment system. The expected timing of payments had been too optimistic and it was not possible to pay five quarters in a row, as expected in the PAD, since between each payment audits had to be finalized, and the quality had to be improved before they could be approved by the Bank. This was not possible given the size of the country and difficulties reaching areas not served by banks and which were cut off from major urban centers due to lack of maintenance of road infrastructure during the conflict first with payments, then to do the audits. On top of this, each audit revealed shortcomings of the payment manual, which was then updated to incorporate emerging lessons before payment of the ensuing tranche. In spite of these difficulties, successive audit reports confirmed that procedures were broadly implemented according the rules and that communication activities to keep families updated on the program were implemented. Management committees were operational in each school, use of funds was defined through consultative meetings before each payment and amounts of funds received and their use were posted publically. The impact on functioning of schools was evaluated after each tranche. 9

24 31. The component was satisfactory implemented and was fully disbursed by May This achievement triggered an Additional Financing to pay two semester tranches of operating expenditures for about 10,000 secondary schools (in the meantime, the Education Sector Reform Support Project had become effective and was paying for primary school operating expenditures). In the end, the AF could not be implemented due to two hindrances occurring successively. First, the audit of the final payment tranche of operating expenditures under the original project had highlighted potential ineligible expenditure. It took over a year for SECOPE to justify these expenditures, which was a condition of disbursement for any operating expenditures under the AF. Secondly, once the education expenditures had been justified, the Education Component was affected by the late justification by UNICEF of expenditures under the Malaria Component. As the Designated Account could not be replenished until these expenditures had been justified, and raising the maximum level of the Designated Account would mean unacceptable risk, there was only US$4.2 million available in the Designated Account instead of US$9.5 million required for one tranche. It was decided not to pay only half the amount to beneficiaries, as there would have been no time to audit the last payment before the closing date, which should have taken place as a project activity. Component 2: Domestic Debt Settlement 32. The settlement of domestic debt was carried out without any major issue. The payments were made through commercial banks and based on the audited list of creditors, provided by the CDPI, set in place to oversee the process and with participation of government representatives as well as creditors. The first tranche (US$23.82 million) was paid to creditors in December 2007 upon receipt of prior verification of creditors by an audit firm and the second tranche (US$24.99 million) was paid in May 2008 upon receipt of the audit of the first tranche. This was a slight delay compared to PAD estimates (second tranche expected in December 2007), due to time taken to recruit the auditor and receive the audit on the first tranche (for 2005), which was satisfactory and unqualified. The component savings and balance (US$2.79 million), which was due to lower than expected audit costs and two firms (out of 379 beneficiary firms for the second and third tranches for 2006 and 2007) choosing not to accept the negotiated discounted settlement, was reallocated in April It should be noted that the EUSRP did not negotiate the discount rates; they were part of a pre-existing agreement negotiated with the assistance of a specialized firm. Component 3: Roads 33. Startup of road rehabilitation was significantly delayed compared to appraisal expectations, since it took a full year from project approval to update technical studies and prepare bidding documents. The crisis and lack of maintenance had led to very significant degradation from the initial date of studies (in 2004) and contract amendments had to be done for new topographical surveys. The bidding process for the first tranche was launched by UNOPS on May 14, 2008 and the works were completed in September 2011, after some delay caused by necessary further adjustments to studies during implementation and the need to redo some of the works due to low quality. 10

25 34. The second tranche of works was determined in consultation between OVD and the mayor based on criteria of needs, economic viability, and to avoid resettlement. A list of 46 candidate sections was reduced to 18, to be constructed in two lots, with consideration to the need to regroup sections for maximum impact. The tendering of studies was launched by UNOPS on April 23, After problems for one contractor to respect deadlines, part of the works for one lot of works of the second tranche were transferred, by mutual consent and by contractual addendum, to the contractor already working on the other lot (the second lowest bidder for the first lot). This allowed the full package of works to be completed and received by the project closing date. During implementation, OVD received support to monitor and evaluate this component through a partnership agreement with UCoP. Component 4: Water 35. Based on the available technical studies, bidding documents were prepared and the works were awarded to the contractor in November Startup of works was delayed until January 2011 due to time taken to agree on who should pay compensation to project affected persons (finance the Resettlement Action Plan - RAP) and clear the sites. The project financed communications campaigns by radio and by local presence and an NGO was recruited to assist the compensated persons to invest their recompense in income-generating activities. 36. Before startup of works, a technical audit was carried out on the design studies, which had been prepared during a post-conflict situation and were further becoming outdated. This resulted in changes to the design of the network and cost savings which allowed an additional settling tank and an access road to a water reservoir to be constructed. The targeted number of household connections was 8,300 initially, but reduced to 5,000 as the production capacity was thought to be less than originally planned. REGIDESO maintained the standard fee for establishing a household connection, although the inputs were financed by the project and the utility company also sought to reduce the number of household connections near water standposts constructed by the project, since this was sought to create less demand for water from the standposts and undermine the market for standpost operators. These factors in essence explain why only 1,088 household connections resulted from the project, although REGIDESO had list of 2,000 interested parties for a household connection. After agreement between REGIDESO and the Bank, these connections will be established under the ongoing Bankfunded Urban Water Supply Project (UWSP). During implementation, REGIDESO received support to monitor and evaluate this component through a partnership agreement with UCoP. Component 5: Malaria 37. Training was implemented by PNLP for a large number of people involved in the distribution both in Kinshasa and later in Bandundu Province, relying on experiences from the Eastern Provinces where the process was already up and running. In Kinshasa, the NGO PSI was recruited to carry out awareness-raising and distribution activities. Component implementation started with an awareness-raising campaign, following which two ITNs were distributed per household from October 2008 to January During 11

26 distribution, persistent rumors circulated that ITNs were toxic, and the WHO, national health authorities and the project had to spend significant efforts to contain these rumors through additional communication and outreach efforts. A follow-up campaign was implemented to make sure the ITNs were used correctly. The AF in Bandundu followed the same approach, with UNICEF recruited to procure ITNs and carry out awarenessraising and distribution. The difference from Kinshasa was that three ITNs were distributed per household to take into account the larger households. Distribution in Bandundu was delayed due to the 2011 elections and to some logistical problems, but the full component was completed by November Monitoring and Evaluation (M&E) Design, Implementation and Utilization Design 38. At appraisal, the PDO indicators, baselines, and targets were available related to each component, although the presentation in the PAD Results Annex does not correctly distinguish activities, outputs, indicators, and targets. UCoP was made responsible for regular tracking of indicators based on information provided by the relevant agencies and organizing meetings with implementing partners and beneficiaries. The M&E team was already in place in UCoP and fully operational from having already worked on the Bankfinanced EESRSP and ELCISP. The core M&E functions were thus operational, but the quality of M&E during implementation would have been higher if the project design had included M&E training to OVD and REGIDESO. Implementation 39. Output data was regularly collected and disbursements and physical outputs were linked in the project monitoring reports. When the AF restructuring was agreed the PDO was correctly adjusted to take into account the expanded geographic scope of the malaria component and the fact that the post-election crisis was over. The revised results framework had adequate indicators to measure the impact on beneficiaries (except for the debt component, which was output oriented). During the AF restructuring the relevant core indicators were added to the results framework to allow reporting on institutional goals. 40. The project made good use of surveys. To overcome the scarcity and unreliability of data in the post-conflict situation, surveys were carried out for the Education Component in connection with the audits after payment of each tranche to verify use of the transferred funds, which allowed the project to gradually improve the communications campaign towards the parents. An impact evaluation was carried out for the Debt Component in 2009 shortly after the payment of the second tranche, with a follow-up survey in 2013, providing useful information for evaluation purposes. The post-distribution campaign surveys for the Malaria Component were carried out by the School of Public Health (ESP) in Kinshasa based on recognized sector standards with infield verification, which assured high quality of data. The Road Component made use of the standard (core indicator) methodology for estimating the number of beneficiaries based on length of road and population density. Overall the data available to evaluate these four components in the ICR is adequate, although the quality had to be reviewed regularly by the Bank and the quality of M&E was rated Moderately Satisfactory in 12